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IFC helps Myanmar firms to improve information disclosure for fundraising

Jun 25. 2017
Luis Mariano Enriquez Mejia, senior corporate governance officer at IFC
Luis Mariano Enriquez Mejia, senior corporate governance officer at IFC
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AS MYANMAR encourages public companies to list on the Yangon Stock Exchange (YSX), the International Finance Corporation is helping the government educate companies about the importance of transparency and disclosure standards in company reporting, according to an IFC executive.

Luis Mariano Enriquez Mejia, senior corporate governance officer at IFC, said that information disclosure is “key” to attract foreign direct investment which would drive the nation to move forward. 

“The most important thing is transparency. If you are an investor, you want to know what is going to happen with your money. The more information you get, the more likely it is to make investment decisions,” he said. 

“It [information disclosure] allows investors to understand what companies they should invest in. It also allows them to be informed of how their money is used. Every investor wants to know about the performance of a company before they decide to invest.” 

Mejia urged Myanmar companies to disclose both financial and non-financial information in a timely manner so that they could improve their access to finance. 

He suggested being mindful of international standards for disclosure requirements, analysing current demand for information in international securities markets and identifying potential areas of improvement in the legal framework. 

“Material information should be disseminated in a timely way to the public without omission. It should not be misleading. Companies have to ensure investors have easy access to their disclosure,” he said. 

Mejia said websites were the best way to disclose information. He urged to ensure all the information was made available on the company websites, preferably in English. Alternatively, he suggested information disclosure via YSX’s website, as a stock exchange plays a key role in sending out information to the public. 

“The stock exchange serves as a central repository. If you cannot find the website of a specific company, you can go and search on the stock exchange website what types of information have been filed,” he said.

According to Mejia, Myanmar, as in every other market, requires listed companies to provide good material information, not only to protect investors but also to raise their capital. He suggested learning from developed markets by observing their regulatory boards and what type of information they disclosed, reading their annual reports and so on.

Mejia said the government and the regulator should encourage companies to disclose accurate information in their annual reports. In this regard, IFC has been helping the government in many different ways since the launch of its corporate governance programme in February last year. 

Obviously, it has conducted a number of capacity-building and knowledge-sharing programmes in Myanmar, said Mejia. Last week, the IFC held a forum to help listed firms raise transparency in cooperation with the Securities and Exchange Commission of Myanmar. 

“It is always very important to hold such an awareness-raising event in order to educate government officials and companies about the importance of international best practices on information disclosure. This event could raise awareness of the companies so that they understand the benefits of listing [on the YSX] and see how listing can function as a financing mechanism,” he said. 

Mejia said companies, investors, banks and regulators should make use of IFC toolkit for transparency and disclosure, entitled “Beyond the Balance Sheet”, which would be available on the corporation’s website soon. The toolkit is designed to guide companies in emerging markets like Myanmar to prepare for comprehensive and best-in-class annual reports. 


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